MBL Developments · Published 2026-08-09 · All insights
How to Finance a Toronto Sixplex with CMHC MLI Select
A new Toronto sixplex is financed as CMHC MLI Select new construction: from 50 points the program allows up to 95% loan-to-cost, with 50-year amortization and a limited-recourse option unlocking at 100+ points, and the loan sized by the lesser of the LTC ceiling and debt coverage at a 1.10 floor. The realistic 105-point pathway for a six-unit building is one affordable unit (70 points) plus an energy design 40%+ better than NBC 2020 Tier 1 (35 points). Everything else in the deal — what you can pay for the lot, how much cash you need, when the money arrives — flows from that structure.
Thresholds verified against CMHC's published MLI Select criteria on August 9, 2026. Criteria change; verify before designing to them. MBL Developments is independent — not affiliated with, reviewed by, or endorsed by CMHC.
The new-construction point pathway for a sixplex
Affordability
| Points | Requirement (new construction) |
|---|---|
| 50 | 10% of units at rents ≤ 30% of median renter income |
| 70 | 15% of units at rents ≤ 30% of median renter income |
| 100 | 25% of units at rents ≤ 30% of median renter income |
On six units, one affordable unit is 16.7% — it clears the 15% tier and earns 70 points on its own. The "lost" rent on one modest unit buys the financing package for the other five; it is one of the highest-value design decisions available to a small developer.
Energy efficiency
Measured against the 2020 national code baselines — and the tier jump is a leap in spec, not a rounding step:
| Points | vs NBC 2020 Tier 1 | vs NECB 2020 Tier 1 |
|---|---|---|
| 20 | 20%+ better | 25%+ better |
| 35 | 40%+ better | 50%+ better |
A spec that is "25% better than code" earns 20 points, not 35 — and a 70 + 20 pathway dies at 90 points. Only an energy modeller can confirm the tier your design actually earns; make them name the baseline, the edition and the percentage in writing.
What the points unlock
| Threshold | Terms (new construction) |
|---|---|
| 50+ | up to 95% LTC, 40-year amortization, DCR floor 1.10 |
| 70+ | 45-year amortization |
| 100+ | 50-year amortization, limited-recourse option |
The chain that prices everything
MLI Select turns a sixplex into a solvable equation, run in one direction:
Closed rents → NOI → value at a defensible cap rate → loan at the coverage floor → supportable total cost at 95% LTC → minus every non-land cost → the maximum you can pay for the lot.
Each link uses evidence, not hope: rents from closed leases in the same pocket (our benchmark), costs from the fixed-price band (what a sixplex actually costs), and the land answer from the max-bid formula. When the asking price exceeds the max bid, the formula is telling you to pass — that discipline is the whole game.
The cash reality
Up to 95% LTC is a ceiling on the facility, not a description of your bank account. Land closes on day one; the insured advance funds against completed milestones months later; peak cash lands before the first advance. A Toronto sixplex still requires roughly $500–700k of sponsor cash through the cycle — the timing math is in why 95% LTC does not mean 5% cash. Model it monthly: land close, predevelopment, draw-by-draw construction with a facility share, then takeout repaying the bridge with premium and fee capitalized and excess proceeds held as construction reserve.
What the lender file contains
An approved lender underwrites the file before CMHC sees it: sponsor summary, lot screen with evidence status, closed-comp rent roll, development budget with scope stated, sources and uses that reconcile to the dollar, stabilized pro forma and sizing under every constraint, the dated MLI pathway memo, the monthly cash and draw schedule, due-diligence status, and a sensitivity analysis. Gaps stated beat gaps discovered — every number labelled as verified fact, assumption or professional estimate.
Where to go from here
Our Toronto-specific course Toronto Sixplex Development & CMHC Financing (the MBL underwriting & development program — course and Deal Lab) walks this entire file from lot screening to lender preparation with deterministic calculations and evidence attached to every assumption. If your property is an existing building rather than a new build, the rules differ substantially — read the existing-property MLI Select guide.
Methodology: program thresholds quoted from CMHC's criteria page, verified August 9, 2026; cost and rent figures from MBL's published Toronto research with dated methodology; interpretations are MBL's own and are not financing advice.
We publish the underwriting we actually use. Follow the build → — monthly data drops. Building your first project? Toronto Sixplex Development & CMHC Financing — the course →